Tagged: whistle-blowers

The Pilatus Bank scandal: time to reconsider banking supervision, anti-money laundering and whistle-blower’s protection in the EU

By Dimitrios Kafteranis

On Monday 23 April 2018, the European Commission released its proposal on the protection of persons reporting on breaches of Union law. The proposal of the European Commission comes after pressure of the European Parliament and other organisations calling for a coherent protection of whistle-blowers at the EU level. This pressure results partially from different scandals that were revealed by whistle-blowers such as Panama Papers or the case of the Pilatus Bank in Malta. The Commission’s proposal aims to set common minimum standards to protect whistle-blowers when they report breaches of EU law. It has several legal bases and covers a wide-range of EU areas such as consumer protection, financial services and the protection of privacy and data. The reporting procedure follows the ‘classic’ three-tier model for whistle-blowing, that is reporting firstly internally, then to the designated authorities and as a last solution to the public. The text is innovative in the sense that it proposes a wide definition of the whistle-blower ranging from trainees to ex-employees. The European Commission regards whistle-blowing as an enforcement tool for the prevention, detection and prosecution of illegalities affecting EU law.

For the future, it is compelling to pursue the negotiations between the two co-legislators of the EU (European Parliament and Council) in order to follow the challenges on the question of whistle-blowing at the national and European level. These negotiations could take many years. This post aims to introduce the reader to the proposal for a Directive on the protection of whistle-blowers by cross-referring to the case of the Pilatus Bank where a journalist and a whistle-blower are involved. The purpose is to highlight that there is a need for an EU Directive on the protection of whistle-blowers and to demonstrate that the proposed EU Directive would have better protected the Pilatus Bank whistle-blower. Furthermore, this contribution will demonstrate the problematic nature of money laundering and banking supervision at the EU level. Following the creation of the Banking Union, the interconnectivity of banks is a fact and a problem in one country can create a domino effect to the others. For example, the Pilatus Bank scandal does not only concern Malta but the European banking system as a whole. Continue reading